Development of new projects in Kaunas stimulated the most expensive apartments sector

The latest survey carried out by Ober-Haus on the most expensive apartments in the country’s three largest cities shows that the gap between the three cities is growing rapidly. This is seen particularly in the latest data of Kaunas and Klaipėda. The current survey analysed the second half of 2018 and the first half of 2019. The survey covered all transactions above EUR 1,800 per sqm (after elimination of the price of a parking spaces, storage facilities and other apartment appurtenances from the total transaction price) registered in the period under consideration in Kaunas and Klaipėda (data source: State Enterprise Centre of Registers).

“The results show the very rapid growth of such property transactions and their total value in Kaunas in the period 2016-2019,” – says Raimondas Reginis, Research Manager for the Baltics at Ober-Haus. According to Ober-Haus calculations, during the second half of 2018, 63 of the most expensive apartments were bought in Kaunas, at a total purchase price of EUR 7.6 million. During the first half of 2019, the number of such apartments bought was the largest since the first half of 2016 (start of the survey period on acquisitions of the most expensive apartments) and the number was 92. The total purchase amount for the apartments (including appurtenances), was EUR 11.9 million euros which is the largest amount in any half-year period in Kaunas (46% more than in the first half of 2018 and 56% more than in the second half of 2018).

“The number of transactions of the most expensive apartments relative to the total number of apartment sales in Kaunas, show that this segment was also growing in 2016-2019,” – noted Raimondas Reginis. According to Ober-Haus data, while the share of the most expensive apartments sold in Kaunas during the H1 2016 was only 0.3% of the total number of apartments sold, 1.8% – in H1 2017, 2.5% – in H1 2018 and the share in H1 2019 jumped to impressive 4.0%.

“The second half of 2018 and the first half of 2019 is distinguished not only by the larger number of acquired objects, but also by their prices. The largest price per sqm did not exceed EUR 2,800 in the period 2016-2018, the highest price per sqm in the H2 2018 and the H1 2019, in some exceptional cases, was as much as EUR 3,000” – says Raimondas Reginis.

Judging by the price per sqm, the most expensive apartment in Kaunas was sold in the H2 2018 – EUR 190,000 (about EUR 3,100 per sqm) were paid for an apartment of just over 60 sqm in a reconstructed historical building in Raguvos Street (Old Town). It is also the most expensive apartment sold since 2016 (according to the price per sqm).

During the H1 2019, an apartment was sold in Kaunas in a new construction project in Kumelių Street. (Old Town) – the apartment of just over 73 sqm was bought for over EUR 220,000 (about EUR 3,000 per sqm).

According to Raimondas Reginis, the rapid growth in the number of apartment transactions in Kaunas city was the result of a particularly large number of construction works in the multi-apartment segment in 2017-2019. Since a number of projects are being developed in the most expensive parts of the city (the central part, the Old Town, Žaliakalnis district), there are a lot of transactions for the most expensive apartments. According to Ober-Haus calculations, 75% of the 155 most expensive apartments sold in Kaunas during the second half of 2018 and the first half of 2019 were from the latest residential projects (completed in 2017-2019).

Price of the most expensive apartment sold in Klaipėda – EUR 2,600 per sqm

Klaipėda’s most expensive apartment segment continues to show stable moderate growth in sales. According to Ober-Haus data, 20 of the most expensive apartments were acquired during the second half of 2018 and a further 20 in the first half of 2019 with total transaction values of EUR 3.1 million and EUR 2.6 million, respectively. Comparing those numbers with previous years, it can be concluded that there was not much change during the last two years in this city – from 10 to 30 such apartments are being sold per half-year.

Analyses of the most expensive apartment transactions in Klaipėda during the last two half-years show that the price per sqm of the most expensive apartment was EUR 2,600” – points out Raimondas Reginis.

Evaluating the price per sqm during the period analysed, the two most expensive apartments in Klaipėda were sold in the same new construction project built in 2015 in Audros Street (in Melnragė district). In the H1 2019, over EUR 180,000 were paid for each 69 sqm sized apartment with basement storage (about EUR 2,600 per sqm).

During the H1 2019, a 64 sqm apartment was sold in an old apartment building in H. Manto Street (next to the Old Town) for EUR 165,000 or EUR 2,550 per sqm.

Another exceptional transaction in Klaipėda was concluded in the second half of 2018 – not only counting by the price per sqm, but it was also the biggest transaction amount. A 140 sqm penthouse apartment on the 21^st floor with a spacious terrace and several parking spaces was sold in a multi-functional residential building Klaipėdos Burė. Altogether EUR 380,000 (about EUR 2,500 per sqm, excluding the cost for parking spaces) were paid for this fully equipped apartment.

“The development of the new multi-apartment buildings in Klaipėda is still considerably less than in Vilnius or Kaunas, and the particularly small number of new projects in the central part of the city or the Old Town does not provide for a more significant rise in the number of the most expensive apartment transactions” – says Raimondas Reginis.

According to Ober-Haus calculations, of the 40 most expensive apartments sold in Klaipėda during the second half of 2018 and the first half of 2019, 38% were sold in recently constructed projects (2017-2019 construction multi-apartment buildings). This figure was 55% in Vilnius and 75% in Kaunas. Evaluating the most expensive apartment transactions in the newest residential projects in Klaipėda, the bulk of them in the period analysed were in the Old Town residential project Ravelino Namai, which was finished in 2018 and offered over 130 apartments to the market.

“Summarised results show that the new residential projects can stimulate the luxurious apartment market considerably. Kaunas housing sector development and the results show that the market is already mature enough for higher class projects not in the country’s capital. We hope that Klaipėda’s housing developers will soon pick up the housing development baton from Kaunas and Vilnius and will develop projects in the central part of the city more decisively” – says Raimondas Reginis.